Getting Past the Automatic Stay in Bankruptcy

One of the most important features of the bankruptcy process is the automatic stay, which stops those from collecting debts from the party filing for bankruptcy protection. Specifically, under 11 U.S. Code § 362, the filing of a bankruptcy petition operates as a stay of:

(1)… a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the case under this title, or to recover a claim against the debtor that arose before the commencement of the case under this title;

(2) the enforcement…of a judgment obtained before the commencement of the case…;

(3) any act to obtain possession of property of the estate or of property from the estate or to exercise control over property of the estate;

(4) any act to create, perfect, or enforce any lien against property of the estate;

(5) any act to create, perfect, or enforce against property of the debtor any lien…;

(6) any act to collect, assess, or recover a claim against the debtor…;

(7) the setoff of any debt owing to the debtor…;

(8) the commencement or continuation of a proceeding before the United States Tax Court concerning a tax liability of a debtor…”

However, the stay can be lifted in certain instances pursuant to Court approval. The most common instances in which the stay is lifted is when a Debtor is delinquent on a vehicle or home and the lender wants to continue on with foreclosure. The Debtor can dispute the creditor’s request to lift the automatic stay; however, if Debtor is not paying and does not have reasonable means of catching up with its payments or if Debtor does not have a valid defense to nonpayment then the automatic stay will likely be lifted by the Court.  Debtors who are unsure whether an automatic stay in bankruptcy can protect them against their creditors need to contact an experienced bankruptcy attorney.

In Albuquerque, Giddens & Gatton Law, P.C. has bankruptcy attorneys who offer expert handling of Chapter 7, Chapter 11, Chapter 12 and Chapter 13 bankruptcy cases in New Mexico. The firm represents many debtors and creditors in Albuquerque, Santa Fe, Taos, Raton, Farmington, Gallup, Grants, Roswell, Los Lunas, Placitas, Belen and the rest of New Mexico. Contact Giddens & Gatton Law, P.C. at (505) 633-6298 to set up an appointment with one of its New Mexico bankruptcy lawyers or visit the firm’s website at Giddens & Gatton Law, P.C. is located at 10400 Academy Road N.E., Suite 350 in Albuquerque, New Mexico.